Psychosis means a break with reality, sometimes with auditory or visual hallucinations and/or paranoid thinking or fixed false beliefs. Neurosis usually means underlying conflicts which influence thinking and behavior.

There’s a saying, “ A neurotic is a man who builds a castle in the air. A psychotic is the man who lives in it.“ Neurotic individuals have unrealistic expectations or ideas, while psychotic individuals are completely out of touch with reality.

Check out thus link - it should help address your question:

https://www.medindia.net/patients/patientinfo/mental-health-neurosis-vs-psychosis.htm